Prime Manhattan Realty Industry News

Overview of Incentives Available to Businesses in Lower Manhattan

For centuries, Lower Manhattan has served as a beacon of American business. Downtown's excellent transportation network, state-of-the-art technical infrastructure, and its famed financial institutions have provided fertile grounds for the world's leading companies and entrepreneurs.

Today, significant incentives exist for businesses to remain in and locate to Lower Manhattan as a result of legislation passed in response to the terrible attack of September 11th and the preexisting Lower Manhattan Economic Revitalization Program. These incentives include:

Grants
Tax credits
Tax abatements/reductions
Tax deductions/accelerated depreciation benefits
Low-cost power
Low-cost financing

Click here to view a map of which incentive programs apply to your location.

View our models that quantify how much money the incentives would save a typical 10 person or 100 person business that remains or locates Downtown.

Grants:

$3500 per employee grants - As of right award of $3500 per employee to all businesses and not-for-profits with fewer than 200 employees that sign a new lease, extend an existing lease or purchase new facilities in Lower Manhattan. Note: a commitment of at least 5 years must be made. Click here for more information.

$5000 per employee grants - As of right award of $5000 per employee to all organizations with fewer than 200 employees that were located in the area bordered by Chambers Street to the north, Broadway to the east, Rector Street to the south and the Hudson River to the west on September 11th, 2001 and sign a new lease, extend an existing lease or purchase new facilities in Lower Manhattan. Note: a commitment of at least 5 years must be made. Click here for more information.

Discretionary grants - Discretionary awards made by the NYC Economic Development Corporation to organizations with more than 200 employees that remain or relocate in Lower Manhattan. Click here for more information.

WTC Business Recovery Grants - As of right award to businesses and non-for-profit organizations with fewer than 500 employees located on or below 14th Street on September 11th, 2001. Click here for more information.

Tax Credits:

$4800 per employee tax credit - A tax credit for both 2002 and 2003 to every business with fewer than 200 employees of up to $2400 per employee based on or south of Canal Street. Click here for more information

Tax Abatements/Reductions:

$2.50 per square foot Real Estate Tax Abatement - Reduces real estate taxes in pre-1975 buildings in Lower Manhattan for five years by up to $2.50 per square foot and requires landlords to pass this savings directly through to tenants through reduced rents. Click here for more information.

Commercial Rent Tax Special Elimination and Reduction - Eliminates the Commercial Rent Tax in pre-1975 buildings in Lower Manhattan for the first three years of a lease and reduces it by two-thirds and one-third for the fourth and fifth years respectively. Click here for more information.

Tax Deductions/Accelerated Depreciation Benefits.

30% bonus depreciation for property - Allows an additional 30% of the cost of office equipment, new technology and other property to be depreciated by businesses in Lower Manhattan in the first year of ownership - a significant acceleration over normal IRS depreciation rates. Click here for more information.

Increased business expense deduction – Allows businesses in Lower Manhattan to reduce their taxable burden by $59,000 ($35,000 higher than normal) for each year until 2006 by writing off equipment. Click here for more information.

Accelerated depreciation for leasehold improvements – Allows any leasehold improvement in Lower Manhattan to be depreciated over 5 years rather than the normal 39 years. Click here for more information.

Low-cost Power:

20% Price Reduction for Power - Allocates up to eighty (80) megawatts of low-cost power – reduced in price by up to 20% -- to businesses that relocate to or begin operations in Lower Manhattan. Click here for more information.

Lower Manhattan Energy Program - Electricity transmission costs reduced by up to 45% for 12 years. A tenant is eligible for savings only if its building's owner has, since 1995, improved the building by 20% of the assessed value. Click here for more information.

Low-Interest Loans:

Small Business Administration - Long term, low interest loans to businesses and non-profit organizations in New York. Maximum loan amount is $10,000,000. For information click here.

Lower Manhattan Small Business and Workforce Retention Project - Loans to retailers and manufacturers of up to $100,000. Funds are limited and are allocated on a first-come, first-served basis. For additional information, please call the Downtown Alliance’s hotline at 212-835-2771.

Accion, NY American Dream Disaster Relief Fund - Loans of up to $30,000 to businesses physically located south of 14th Street or with a majority of clients located south of 14th St. An additional 10% of the loan amount is available as a grant. For information click here or Sarah Sable at 718.620.0353.

Prime Manhattan Realty
35 West 36th Street, 9th Floor, New York, NY 10018
Tel. 212-268-8043 Fax 212-268-5742
www.manhattanoffices.com
Jonathan Anapol

Copyright © 2000 Prime Manhattan Realty. All rights reserved.
Revised: October 12, 2005